MAHAICONY Rice Limited (MRL) refusal to hand over accounts to Guyana Rice Development Board (GRDB) officers on Monday is a matter that is now with the Director of Public Prosecution (DPP).
In an invited comment, Agriculture Minister Robert Persaud said “tough action” will be taken to ensure that the company complies with the agreements it made with rice farmers.
The company signed agreements with rice farmers to make half the payments after the first 14 days of paddy receipt and the rest after 41 days, and delays were to attract two per cent plus the current lending rate at banks as interest.
However, MRL has failed to honour its obligations and a number of farmers are still waiting for payment, close to nine months now.
“Mahaicony has been making some payments, but it has been very slow…we are taking the legal route to ensure that they comply,” Persaud said.
It is estimated that Mahaicony Rice Mill owes farmers some $300M, and an audit team went into MRL to get an accurate picture of the company’s indebtedness to the local rice farmers.
This move by the GRDB is in accordance with section 10 (1) of the Rice Factories Act.
When the team arrived at MRL, the accountant refused access to the information and the GRDB officers were informed that the MRL employee had instructions not to hand over the accounts. The police were summoned and they escorted two MRL staff to the Mahaicony Police Station.
Persaud said, “Statements were taken today (Tuesday) and we will follow the legal process to ensure that the farmers are paid.”
In addition to this police matter, the embattled company is tied up in court by rice farmers who look legal action to secure what was owed to them.
Also the company is facing a class action lawsuit which will go after the company’s assets in an attempt to have the rice farmers’ debts settled.
At present, the Ministry of Agriculture is taking steps to amend the Rice Factory Act so that rice farmers can have some added protection. The amendment is expected to ensure that millers have to pay every farmer 95 percent of monies owed them before they receive a licence. This must be completed within 42 days of supply. The Rice Factories (Amendment) Bill 2010 was read for the first time in the National Assembly in July.